TaxTMI 
TaxTMI 
TaxTMI 
2024 (3) TMI 286
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..... It has been revealed that the work orders were awarded to the appellant by various developers/builders of the township for various work required to develop a township such as construction of sewer lines, chamber, boundary walls, sump well, parking areas, roads etc. It was also found at the time of scrutiny of records that on some bills service tax was not paid by them treating the said bills for exempted services. Show cause notice dated 21.10.2015 was issued raising demand of service tax of Rs. 1,14,85,964/- with the following break up : Work Period Amount of Service Tax Civil work (other than road construction 2010-11 to 2013-14 Rs. 15,79,645/- Construction of road 01.07.2012 to 2013-14 Rs. 99,06,318/- 3. The show cause notice also proposed charging of interest and penalty under section 77 and 78 of the Finance Act, 1994 and also proposed for appropriation of Rs.26, 76, 565/- towards service tax liability having been paid during investigation by the appellant. On adjudication, the Principal Commissioner confirmed the demand relying on the Notification No. 25/2012-ST dated 1.07.2012 and the Circular No. 334/1/2012-TRU dated 16.03.2012. Being aggrieved, the present app....
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....tion of service tax liability under the Notification No. 25/2012 which specifically provides for exemption in case of construction of road for use by general public whereas the appellant has rendered services for construction of road and other infrastructure for development of colonies/township and construction of residential complexes. The appellant is working under self assessment system and is therefore duty bound to disclose the true and correct facts and assess their service tax liability accordingly but they deliberately suppressed the facts with intent to evade the payment of service tax and therefore the extended period and the penalty has been rightly invoked. 6. The issues considered by the adjudicating authority was whether the activity of construction of roads can be covered under the category of "Commercial Construction or Works Contract Services" or otherwise for the period 1.07.2012 to 2013-14 and whether the exemption on construction of roads under notification no. 25/2012-ST would be available to them or not. 7. As per the work order issued by the project developers to the appellant, it appears that the appellant had rendered their services for construction of re....
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....ng services in relation to residential complex such as glazing, plastering, painting, floor and wall tiling, wall covering and wall papering, wood and metal joinery and carpentry, fencing and railing, construction of swimming pools, acoustic applications or fittings and other similar services; or (c) repair, alteration, renovation or restoration of, or similar services in relation to, residential complex. (25b) "Commercial or industrial construction" means - (a) construction of a new building or a civil structure or a part thereof; or (b) construction of pipeline or conduit; or (c) completion and finishing services such as glazing, plastering, painting, floor and wall tiling, wall covering and wall papering, wood and metal joinery and carpentry, fencing and railing, construction of swimming pools, acoustic applications or fittings and other similar services, in relation to building or civil structure; or (d) repair, alteration, renovation or restoration of, or similar services in relation to, building or civil structure, pipeline or conduit, which is - (i) used, or to be used, primarily for; or (ii) occupied, or to be occupied, primarily with; or (iii) engaged, ....
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....l complexes by a builder/developer/coloniser for the utility of the occupants therein. The two has to be distinguished on account of the nature of utility, whether the same is meant for common public or for private use by the buyers of the builders. Also, the definition clause (q) of the notification defines "general public" meaning the body of people at large sufficiently defined by some common quality of public or impersonal nature. We have no doubt on the intent and the scope of the notification exempting the construction of roads for use by general public and as per the Rules of interpretation the exemption notification has to be construed strictly. Considering the activity of construction of roads by the appellant for the development of the township/residential complexes on behalf of the builders/ developers is specifically meant for the buyers of the plots/residential/commercial complexes and the same cannot be termed for the use of the general public in the sense it has been provided in the notification. Hence the appellant is not entitle to claim exemption from levy of service tax under the notification. 11. In addition to the notification, we find that CBEC had issued Mas....
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....ll be no easy approach to the main entrance of residential complex inclosed by a boundary wall and main gate. I further find that services provided by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of a road, bridge, tunnel or terminal for road transportation other than for use by general public came under service tax net w.e.f. 01.07.2012 as the condition of use by general public has been imposed by Notification No. 25/2012 dated 20.06.2012. Hence the noticee's contention is not acceptable as the said construction of roads have not satisfied the condition of Notification No. 25/2012-ST." 14. From the records of the case including the statements of the appellant, we find that they had rendered all the services of construction with material, though in some case they issued separate bills for labour charges and raw material for the same work and charged VAT in the bills of raw material. Therefore, the services executed being works contract were rightly classified under the category of "Work Contract Services", as defined under Section 65(105) (zzzza) of the Act. In this regard, we may quote the par....